Annex 2
Royal Mail Group plc
The books are now closed on the last financial
year and the finance people are busy totting up the numbers. The
books need to be audited and signed off by the accountants, but
all the signs are looking good. I'm optimistic that we'll hit
the profit target and that we'll be paying out £400 Share
in Success to everyone who's eligible. Don't spend it yet... and
remember you'll have to pay tax on it... but it's worth giving
some thought to what you might do with this year's payment. If
we do hit the numbers it'll be down to your hard work... so thanks
for that.
With all the talk of possible share schemes
in the press, I thought it would be helpful to give you our perspective
on the issue.
— Is it a done deal? No,
it's not. And the final decision rests with Government, our shareholder,
but I'm confident we'll get you shares.
— Do I think it's a good idea?
Yes, absolutely. I'm passionate about giving some of the business
to the people who actually deliver for our customers, ie you.
— Is this privatisation?
No! Let me be clear. There are no plans to privatise this business.
Under the scheme I'm proposing, up to 20% of the business would
be shared with people working for Royal Mail in the UK, with the
rest staying in the hands of the Government.
— Will the shares grow in value?
I don't have a crystal ball... but if the business grows so will
the value of your shares. All we have to do is to continue to
hit our targets and deliver for our customers... as we have over
the past few years. We know we can deliver. We've a track record
of success. So there's no reason why we shouldn't plan to carry
on making money and increasing the value of the business.
— Are there any strings?
Not if Government accepts our proposals. You'll have to work for
the business... and have been employed for at least one year...
but that's hardly a string! We would start by sharing out a chunk
of the business—equally to everyone—just because they
work for Royal Mail Group. And, as well as the value of the shares,
you'll also get a cash bonus—like a dividend—each
year, as long as we hit our targets.
— Will this cost you anything?
Not a penny. You won't have to buy your shares so you can't possibly
lose any money. They will be available to everybody who has been
with us for a year or more.
— Will this mean less in pay?
No way. Pay is what you get for doing your job. Shares would give
you real ownership of the business and are extra to basic pay.
We will continue to give you the best pay rise we can afford under
the current market conditions, but with so much uncertainty around
the impact of competition and the loss of volumes it's impossible
to predict the future... and I never make promises that I can't
keep.
— Will you be able to cash
in your shares? Yes, that's the plan, although not immediately.
You'll be able to sell your shares after three or five years—but
only within the company—or buy more shares if that's what
you want. Between the share value and the dividend we hope you
will be sitting on a nice nest egg.
— What happens to Share in
Success? It's going to take us a while to get the share scheme
agreed and sorted—and we'll have to get the law changed
before you can own shares. So... until then... we plan to keep
paying you your share of the profits... like an annual dividend.
— Will this affect my pension?
No, but we do need to keep improving our efficiency, to free up
cash to fund the scheme—which is likely to be an extra £250
million a year.
— Isn't this about board members
getting rich? No—everybody in the company will have
the same allocation of shares with the same value, regardless
of position.
So, that's shares!
We hope to complete a funding package shortly—to
protect pensions and provide money to invest in the business.
And we're focusing our efforts on balancing the many calls on
our cash—so people can get a bit more in pay, can enjoy
some job security—because the business is strong and has
a bright future—and continue to look forward to a good retirement.
It's a difficult balancing act ... but that's what I believe is
in the best interests of you and the company as a whole.
More to come on all these topics... but here's
what I need from you...
If you would like to receive your free shares
please register your interest by completing the enclosed slip
and sending it back to me, in the pre-paid envelope, within the
next seven days.
Thank you... I look forward to hearing from
you...
My best regards to you and your family,
Allan Leighton
Chairman
2 May 2006
Proposed employee share scheme—expression
of interest
I would like to register my interest in receiving
employee shares. Please put my name on the list to make sure I
get more information, when it's available.
| Name:
·······························································································································································································
|
| Business unit:
·······························································································································································································
|
| Work location:
·······························································································································································································
|
| Pay number:
·······························································································································································································
|
| Home email address (if you are happy for us to contact you in this way):
·······························································································································································································
|
|
